by Risk calculated on 05/24/2023 07:00:00
From the MBA: Fall in mortgage applications in latest weekly MBA survey
Mortgage applications fell 4.6% from the previous week, according to data from the Mortgage Bankers Association (MBA) Weekly Mortgage Applications Survey for the week ending May 19, 2023 .
The composite market index, a measure of the volume of mortgage applications, fell 4.6% on a seasonally adjusted basis from the previous week. On an unadjusted basis, the index was down 5% from the previous week. The refinancing index was down 5% from the previous week and was 44% lower than the same week a year ago. JThe seasonally adjusted shopping index fell 4% from the previous week. The unadjusted buy index was down 5% from the previous week and was 30% less than the same week a year ago.
“Mortgage applications fell nearly 5% last week as borrowers remained sensitive to higher rates. The 30-year fixed rate rose to 6.69%, the highest level since March,” said Joel Kan, MBA vice president and deputy chief economist. Since rates have been so volatile and inventory to sell is still scarce, we have yet to see sustained growth in buying requests. Refinancing activity remains subdued, with the refinancing index falling to its lowest level in two months and more than 40% below last year’s pace.
Kan added: “Investors remained alert to the uncertainty surrounding the US debt ceiling and the communication from several Federal Reserve officials last week, which pushed up Treasury yields, as well as mortgage rates. . Economic data released last week also indicated a still resilient economy. The housing market received positive data on new residential construction – which is seen as a key solution to the lack of housing inventory.
The average contractual interest rate for 30-year fixed rate mortgages with conforming loan balances ($726,200 or less) increased from 6.57% to 6.69%, with points rising from 0, 61 to 0.66 (including origination fees) for 80% loan-to-loan to value (LTV) ratio.
Click on the graphic to enlarge the image.
The first chart shows the MBA mortgage purchase index.
According to the MBA, buying activity is down 30% year-over-year unadjusted.
With higher mortgage rates, the refinance index fell sharply in 2022 – and has remained stable at a low level since then.